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DRM Can Hurt Sales, Says New Study

Posted on Monday, October 10 @ 13:05:00 PST by

New research by Rice University and Duke University have concluded that, as much as publishers believe that DRM is necessary to combat piracy, adding DRM may actually increase piracy.

Using analytical modeling, professors Dinah Vernik of Rice and Devavrat Purohit and Preyas Desai of Duke found that while DRM makes "piracy more costly and difficult, the restrictions also have a negative impact on legal users who have no intention of doing anything illegal", as shown in their upcoming new paper "Music Downloads and the Flip Side of Digital Rights Management Protection":

Only the legal users pay the price and suffer from the restrictions. Illegal users are not affected because the pirated product does not have DRM restrictions.

In many cases, DRM restrictions prevent legal users from doing something as normal as making backup copies of their music. Because of these inconveniences, some consumers choose to pirate.

Removal of these restrictions makes the product more convenient to use and intensifies competition with the traditional format (CDs), which has no DRM restrictions. This increased competition results in decreased prices for both downloadable and CD music and makes it more likely that consumers will move from stealing music to buying legal downloads.

[The late] Steve Jobs said it best: 'Why would the big four music companies agree to let Apple and others distribute their music without using DRM systems to protect it? The simplest answer is because DRMs haven't worked, and may never work, to halt music piracy. And our research presented a counterintuitive conclusion that in fact, removing the DRM can be more effective in decreasing music piracy than making the DRM more stringent.

[Image Credit: Churba by deviantART]
Tags:   DRM

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